Just six months after pulling out of Hutchison Essar, the Hinduja group is set to throw its hat into the ring for the country's fourth largest telecom company.

Ashok P Hinduja, executive chairman of Hinduja TMT, told Business Standard: "We will definitely place our proposal before Hutchison Whampoa. We have written to Hutchison Whampoa enquiring if it indeed wants to sell its shareholding in Hutchison Essar. We expect to hear from them in a day or two."

He went on to add, "Funds will not be an issue if we want to pursue the bid."

Meanwhile, Reliance Communications Ltd has convened a board meeting on January 10 to consider raising resources from international markets.

The company would consider raising a combination of equity and debt by way of foreign currency convertible bonds, external commercial borrowings and other instruments, it informed the Bombay Stock Exchange on Wednesday.

Merchant banking sources say the company is looking to raise $4-5 billion and a part of it may be used to bid for 100 per cent stake in Hutchison-Essar. When contacted, a Reliance spokesperson confirmed that a board meeting had been scheduled but declined to provide details.

As for the Hindujas, since divesting in favour of Hutchison Whampoa its 5.11 per cent stake in Hutchison Essar for $450 million (over Rs 2,000 crore) in June 2006, the group has been saying it finds "good opportunity in the GSM telephony segment."

Hinduja said the sale of stake was in line with the group's policy of continuing in only those companies in which it had a majority holding. Hutchison Whampoa did not want to sell its stake at that time. "So, we did not find merit in holding on to a minority stake in Hutchison Essar," he added.

Analysts said the war for Hutchison Essar promised to be one of the most fiercely fought in the history of corporate India. British telecom major Vodafone, Reliance Communications, the country's second largest telecom company, and the Essar group, Hutchison's Indian partner, are already in the fray.

The bidding war has scaled up the valuation of the company to $20 billion.

Hutchison Telecommunications, a part of Hong Kong-based shipping and property magnate Li Ka-shing controlled Hutchison Whampoa, holds a 52 per cent stake in Hutchison Essar, while 15 per cent is with Analjit Singh of Max Healthcare and Hutchison Essar CEO Asim Ghosh. The Essar group holds a 33 per cent stake.

Just a few weeks ago, the board of Reliance Communications had cleared a proposal to raise $1 billion as debt. The company has been talking to global private equity and buyout funds like Carlyle Group, Blackstone Group, Kohlberg Kravis Roberts & Co, and UBS for funds to bid for Hutchison-Essar.

With cash reserves and surplus of $1.75 billion and a comfortable net debt-equity ratio of 11:1, Reliance is in a position to raise resources. It can also bring in fresh capital by partly divesting its stake in Flag Telecom and the newly floated tower company, set up by transferring the telecom tower assets of the company.

At a recent press conference, RCL Chairman Anil Ambani had said, "The company, as part of its overall growth strategy, continuously examines organic and inorganic growth opportunities. Hutchison Essar is one such situation."

On the interest shown by private equity majors, he stated that it was far in excess of what the company could consume.

Meanwhile, the Ruias are close to finalising a consortium of five bankers to bid for the Hutchison stake. Merchant banking sources say they are waiting for an indicative price from other bidders before they reveal their cards.

Analjit Singh (who holds 8.75 per cent in Hutch-Essar), when contacted by Business Standard on whether he had been approached by Vodafone to be an Indian partner, said, "It is too premature and speculative."